GIC part-exits Edelweiss for $11M, promoter Rashesh Shah buys bulk of the shares

Singapore's sovereign wealth fund GIC has sold a fifth of its holding in its eight year old investment in financial services firm Edelweiss Financial Services for around Rs 71 crore ($11.5 million). Bulk of the shares were acquired by Edelweiss promoter and chief Rashesh Shah.

GIC is the second largest institutional shareholder in Edelweiss behind Carlyle. Other investors in the firm include SAIF Partners and Rakesh Jhunjhunwala.

GIC had originally co-invested along with Shuaa Capital way back in December 2006 picking preference shares for around Rs 67 crore. It had later also bought some shares held by Greater Pacific Capital.

Post its IPO in 2007, GIC was the single largest institutional shareholder and remained so till Carlyle bought a stake through secondary market purchases over the last few years.

As of September 30, 2014, GIC held 8 per cent in Edelweiss. It has sold 1.65 per cent stake today and its remaining stake is worth Rs 258 crore ($40 million).

It is not the first pre-IPO investor in the firm to press on the exit button. Earlier, investors such as Sequoia Capital and Greater Pacific exited the public listed financial services company.

Early this year, Greater Pacific Capital fully exited its eight-and-a-half-year old investment in Edelweiss Financial Services Ltd by selling its remaining 3.44 per cent stake in the company for Rs 148 crore ($25 million) via open market transactions. A part of the stake (1.3 per cent) was picked by ace private investor and trader Rakesh Jhunjhunwala for Rs 55 crore.

The fund had also sold 1.63 per cent stake in Edelweiss for Rs 70.6 crore through market sale early this year. Prior to that Greater Pacific Capital had sold some 1.25 per cent stake in Edelweiss in the last quarter of 2010.

Sequoia Capital also exited early this year.

For GIC this marks the third known part exit from an India portfolio this year after it sold shares of Marico Kaya and Hero MotoCorp.

One of the most active sovereign wealth funds in India, GIC has invested in Flipkart this year besides some realty deals including the latest transaction where it is seeking to buy a majority stake in public listed firm Nirlon. Nirlon owns an IT park in Mumbai.

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